Major stock indexes ended a choppy week with solid gains after the government reported that hiring in the U.S. jumped last month to the highest level since January and more in Friday’s Stock Market Update.
Companies that stand to benefit the most from a growing economy rose the most Friday.
Technology and industrial companies climbed, as did banks. Micron Technology (MU) rose 2.8%, 3M (NYSE: MMM) added 4.3% and JPMorgan Chase (NYSE: JPM) rose 1.5%.
The Labor Department said employers added 266,000 positions, well above estimates of 184,000. The report also showed unemployment falling to a 50-year low. Separately, an index that measures how consumers feel about the economy showed an increase from last month.
The encouraging reports offer reassurance for investors who may have been worried that consumers might be pulling back on spending, said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management.
“Increasing jobs, people back to work, plus that jump in consumer confidence tells you that the consumer is still there, and probably will still spend money,” he said. “It’s a better than we expected set of data, and clearly the market is pricing that in.”
The surprisingly good employment picture comes at the end of what started as a rough week for the market. Increased trade tensions and disappointing economic data sent the market to steep losses on Monday and Tuesday and the major indexes stayed in a slump through Thursday.
The solid jobs report sent bond yields higher, which banks rely on to charge higher interest rates on mortgages and other loans. The yield on the 10-year Treasury rose to 1.84% from 1.79% late Thursday.
Utilities lagged the market as investors shifted money away from safe-play holdings.
Steady job growth has been one of the bright spots in the economy, along with solid consumer spending. The latest employment report is also a welcome development following reports earlier this week that showed manufacturing continues to shrink and growth in the service sector is slowing.
STOCK MARKET UPDATE
KEEPING SCORE: The S&P 500 rose 28 points, or 0.9% to 3,145, erasing its losses for the week. The Dow Jones Industrial Average rose 337 points, or 1.2%, to 28,015. The Nasdaq rose 85 points, or 1%, to 8,656.
The Russell 2000 index of smaller company stocks outpaced other indexes with a 1.1% gain.
Major stock indexes in Europe finished higher.
REDEEMING REPORT: The S&P 500 finished with a 0.2% gain for the week after the strong jobs report put investors in a buying mood. That’s a solid pivot from losses of more than 1% as of late Thursday.
The other major indexes are still on track for losses, though much of the decline has been erased. The Nasdaq and Dow finished the week only slightly down less than 0.1%.
TRADE THAW: China said Friday that it is waiving punitive tariffs on U.S. soybeans and pork as negotiations for a trade deal with the U.S. continue. Investors were rattled this week when President Donald Trump said he wouldn’t mind waiting until after the 2020 elections for an agreement. Wall Street has been hoping enough progress can be made on a deal to avert new tariffs on Chinese goods, such as laptops and cellphones, set to become effective on Dec. 15.
China has been seeking relief from some tariffs as part of the negotiations.
RIDE SAFETY: Uber (NYSE: UBER) slipped 2.7% after a safety report revealed that more than 3,000 sexual assaults were reported during its U.S. rides in 2018. The report is part of the ride-hailing company’s effort to be more transparent after years of criticism over its safety record.
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